What happened

It appears yesterday was not, in fact, the end of the rally for the S&P 500.

This morning, shares across the markets spiked sharply higher. By 12 p.m. EDT, the S&P 500 was up a strong 3%. Stock names closely tied to the travel and tourism industries are experiencing especially strong support:

  • Online travel agency Expedia Group (NASDAQ:EXPE) is up 4.9%
  • Travel planner TripAdvisor (NASDAQ:TRIP) soared 16%
  • Hotel chain Marriott International (NASDAQ:MAR) notched a 5.1% gain
  • Hyatt Hotels (NYSE:H) is up 5.7%.
Four paper-plane arrows pointing up

Image source: Getty Images.

So what

What do these four stocks have in common? Basically, they form a continuum of the tourism experience, wherein would-be travelers might begin researching a trip on TripAdvisor before heading over to Expedia to make reservations to stay at a Marriott or Hyatt hotel upon arriving at their destination.

And today, investors appear to be betting that a lot more people will be taking a lot more trips soon.

Why might that be? This morning, the U.S. Bureau of Labor Statistics reported a 2.5 million-job surge in jobs added to U.S. payrolls in the month of May. When you consider that economists had been predicting a 7.2 million decline in jobs, that's pretty surprising news. BLS also said that the national unemployment rate has dropped from almost 15% to about 13.3%.  

At the same time, New York Mayor Bill de Blasio is keeping New York City's plans to begin a Phase 1 reopening of NYC on Monday, which in and of itself could add somewhere between 200,000 and 400,000 jobs to the economy. If all goes well, Phase 2 could arrive by early July, reopening restaurants for outdoor dining and adding back even more jobs previously lost to the Great Lockdown.  

Now what

More businesses reopening means more reason to travel -- and more travel-related businesses to entertain travelers when they arrive. More jobs means more disposable income for consumers to spend on travel. In short, both of these developments, arriving one on top of the other, are giving investors a lot of reason to be optimistic that America could soon return to normal.

That being said, I would like to inject one note of caution into today's rally. "Normal" won't arrive overnight, and some of the moves we're seeing in the stock market these past few days don't seem to reflect that fact. I'm thinking most specifically of American Airlines (NASDAQ:AAL) investors bidding up the stock of an airline 41% yesterday, and as much as another 36% this morning -- all on news that the company hopes to fly just half as many passengers in July 2020 as it did in 2019.

That rally didn't make much sense to me. These others that we're seeing today may not, either.